One of the biggest benefits of a VA loan is that you can do a streamlined refinance. Known as an Interest Rate Reduction Refinance Loan or an IRRRL, you can do that where you have no appraisal, minimum income verification, and same with credit. And you can refinance your rate if rates are lower.

Now, sometimes folks assume that once they leave their home on that VA loan, and they move out and rent it out, they can’t utilize an IRRRL.

The fact is you can.

You can utilize an IRRRL even if you happen to have owned the home, and you’ve moved out and are now renting it.

So for example, if you purchased a home at one location and then you PCS – you made a move, or if you were a civilian at the time, you’re just a veteran, you moved away and you rented that home out, and it’s still a VA loan – you can still use an IRRRL.

Unlike on conventional loans, or other loan types where your refinances are limited – especially if they’re investment properties – and you have to go back through appraisal and all that kind of stuff.

If you own the home as your primary residence once and bought it with a VA loan and it’s still a VA loan even though you’ve moved out and maybe rented that home out. Like especially for the military when you got orders and moved away, you can still do a VA IRRRL on that property.

This is big right now because rates over the past couple of months have come back down a bit.

So, when rates were at their highest just last year in 2023, now all of a sudden folks can take advantage of doing a VA IRRRL on maybe one of those homes that they might have already moved out of in the past year for their next duty station.

So, keep in mind, you can do a VA IRRRL even on homes that you might not live in now and are renting out.

Now, sometimes we’ll get asked, “Can I do a cash-out refinance where you take out up to 100% of the equity if you choose to in the home?”

No, you cannot.

In that case, it’s got to still be your primary residence.

You got to do appraisal all that good stuff.

But to help lower the interest rate doing a streamlined refinance, that can be done even if you happen to be renting the home out. But as long as it’s still a VA loan and you bought it as a VA loan, it can be done.

My name’s Evan Kaufman, your VA loan originator. Hope this helps you win a home with VA loan. Take care.